In this paper, we propose a new Benes-type wavelength division multiplexing (WDM) optical network with space-wavelength switching capability. Intuitively, adding wavelength switching capability to space Benes networks requires the use of additional hardware components (i.e., wavelength converters). However, in this paper, we show that a Benes network with full-permutation capability in both space and wavelength domains can be designed using a smaller number of hardware components but the same number of stages as that in a space-only Benes network. In addition, wavelength conversion in the proposed network occurs only between two pre-defined wavelengths, eliminating the need for any expensive wide-range wavelength converters. The proposed Benes network is based on the newly proposed concept of wavelength-exchangeable permutation networks. Wavelength-exchangeable networks implement single-step space and wavelength switching and hence reduces the number of hardware components. We show that, such wavelength-exchangeable networks possess some interesting properties that can be used for designing routing algorithms to improve signal quality.